Acacia Research Reports Second Quarter Results.NEWPORT BEACH Newport Beach, residential and resort city (1990 pop. 66,643), Orange co., S Calif., on Newport Bay and the Pacific Ocean; inc. 1906. It is a popular seaside resort and yachting center. Manufactures include electrical and medical equipment, computers, boats, and adhesives. , Calif. -- Acacia acacia (əkā`shə), any plant of the large leguminous genus Acacia, often thorny shrubs and trees of the family Leguminosae (pulse family). Research Corporation (Nasdaq:ACTG ACTG Acting ACTG AIDS Clinical Trial Group ACTG Actuating/Actuator ) (Nasdaq:CBMX) today reported results for the three months ended June 30, 2004. Acacia Research Corporation comprises two operating groups, the CombiMatrix group and the Acacia Technologies
"The CombiMatrix group reported revenues of $750,000 during the second quarter of 2004, which were comprised primarily of $701,000 of government contract revenues under its biowarfare detection contract with the Department of Defense and $49,000 of microarray See micro array. microarray - A technique for performing many DNA experiments in parallel. Nothing to do with computers. product sales and other contract service revenues," said Dr. Amit Kumar, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. and President of CombiMatrix Corporation. "Significant recent events include the July 2004 launch of our 12,000-site ("12K") CustomArray(TM) product for DNA DNA: see nucleic acid. DNA or deoxyribonucleic acid One of two types of nucleic acid (the other is RNA); a complex organic compound found in all living cells and many viruses. It is the chemical substance of genes. expression analysis, following the launch of our low-density microarray product in the first quarter. We also began the development and launch of a number of catalog catalog, descriptive list, on cards or in a book, of the contents of a library. Assurbanipal's library at Nineveh was cataloged on shelves of slate. The first known subject catalog was compiled by Callimachus at the Alexandrian Library in the 3d cent. B.C. microarrays under this product line. In concert with our product launches, we announced the appointment of our Director of Sales, Mike Tognotti, and have recently hired several regional sales representatives. In addition, we have recently entered into strategic relationships with Axon axon: see nervous system; synapse. Instruments and Strand Strand, street in London, England, roughly parallel with the Thames River, running from the Temple to Trafalgar Square. It is a street of law courts, hotels, theaters, and office buildings and is the main artery between the City and the West End. 1. Genomics for microarray readers and data analysis software, respectively. We made good progress on our biowarfare detection contract and have been informed by the Office of U.S. Senator Patty Murray Patricia Lynn Murray (born October 11, 1950) is the senior United States Senator from Washington. A member of the Democratic Party, she was first elected to the Senate in 1992 and has held the position ever since, becoming the first woman to represent Washington in the Senate. from the State of Washington, that the recent budget which will be approved by Congress and sent to the President's office for his signature, has a line item for an additional $2.3 million for Fiscal Year 2005, for continued development. We also continued to see progress in our nanotechnology partnerships. Finally, we expanded our research, development and licensing agreement with our collaborator, the irsiCaixa Foundation and identified two RNA RNA: see nucleic acid. RNA in full ribonucleic acid One of the two main types of nucleic acid (the other being DNA), which functions in cellular protein synthesis in all living cells and replaces DNA as the carrier of genetic compounds, which show tremendous in vitro in vitro /in vi·tro/ (in ve´tro) [L.] within a glass; observable in a test tube; in an artificial environment. in vi·tro adj. In an artificial environment outside a living organism. efficacy against the HIV HIV (Human Immunodeficiency Virus), either of two closely related retroviruses that invade T-helper lymphocytes and are responsible for AIDS. There are two types of HIV: HIV-1 and HIV-2. HIV-1 is responsible for the vast majority of AIDS in the United States. virus, for downstream pre-clinical development Pre-clinical development is a stage in the development of a new drug that begins before clinical trials (testing in humans) can begin, and during which important safety and pharmacology data is collected. ," concluded Dr. Kumar. "The Acacia Technologies group's revenues for the second quarter of 2004 were $666,000. The Acacia Technologies group has entered into 160 licensing agreements to date, including 9 new licensing agreements in the past 10 days following the Markman Order. The new licenses include our second cable TV license and additional e-learning and corporate website licenses. Significant recent events include a license with On Command Corporation, which together with our licenses to LodgeNet, General Dynamics General Dynamics Corporation (NYSE: GD) is a defense conglomerate formed by mergers and divestitures, and as of 2006 it is the sixth largest defense contractor in the world[1]. The company has changed markedly in the post-Cold War era of defense consolidation. Interactive and NXTV, give us agreements with companies that provide over 90% of the on-demand TV entertainment to the hotel industry in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. ," commented chairman and CEO, Paul Ryan Paul Ryan may refer to:
Acacia Research Corporation Consolidated Financial Results Consolidated revenues for the second quarter of 2004 were $1,416,000 versus $25,000 in the comparable 2003 period. Second quarter 2004 revenues were comprised of $701,000 in government contract revenue and $49,000 in microarray product sales and other contract service revenues, all of which were recognized by the CombiMatrix group, and Digital Media Transmission ("DMT See DSL. (R)") license fee revenues totaling $666,000 recognized by the Acacia Technologies group. The second quarter 2004 consolidated net loss was $4,669,000 versus $6,774,000 in the comparable 2003 period. The second quarter 2004 results include non-cash patent amortization, asset depreciation and stock compensation charges totaling $865,000 versus $1,549,000 in the comparable 2003 period. The second quarter 2004 results also include a net legal settlement credit of $391,000 related to the change in fair value of AR-CombiMatrix common stock potentially issuable in connection with certain anti-dilution provisions Anti-Dilution Provision A provision in an option or a convertible security. It protects an investor from dilution resulting from later issues of stock at a lower price than the investor originally paid. of the September 2002 settlement agreement with Nanogen, Inc. The results for the comparable 2003 period include a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. totaling $207,000 related to the write-down of our investment in ADX ADX Average Directional Movement Index ADX Automatic Data Exchange Adx Adrenodoxin ADX Adrenalectomized ADX Accumulation/Distribution Index ADX Air Defense Exercise ADX Administrative Maximum Facility ADX Address Cross Reference Corporation. Consolidated research and development expenses in the second quarter of 2004, comprised solely of costs incurred by the CombiMatrix group, were $2,062,000 (including government contract costs) versus $2,158,000 in the comparable 2003 period. Second quarter 2004 research and development activities included increased costs incurred in connection with the CombiMatrix group's commitments under its biowarfare detection contract with the Department of Defense and costs related to other internal research and development efforts in the areas of genomics, drug discovery and development and material sciences. Research and development expenses in the comparable 2003 period related primarily to the CombiMatrix group's research and development agreements with Roche Diagnostics Roche Diagnostics Division is a subsidiary of Hoffmann-La Roche which manufactures equipment and reagents for research and medical diagnostic applications. Internally, it is organized into six major business areas: Roche Applied Science, Roche Centralized Diagnostics, Roche , GmbH ("Roche"), which were completed in the first quarter of 2004. Marketing, general and administrative expenses in the second quarter of 2004 increased to $3,964,000 from $3,552,000 in the comparable 2003 period, due primarily to the addition of licensing and business development personnel for the Acacia Technologies group, an increase in marketing and sales costs related to the launch of the CombiMatrix group's CustomArray(TM) DNA microarray DNA microarray A small solid support, usually a membrane or glass slide, on which sequences of DNA are fixed in an orderly arrangement. DNA microarrays are used for rapid surveys of the expression of many genes simultaneously, as the sequences contained on a platform in March 2004, an increase in corporate professional fees related to ongoing Sarbanes-Oxley compliance projects at both operating groups and an increase in the Acacia Technologies group's general and administrative overhead costs overhead costs see fixed costs. related to ongoing operations. Acacia Technologies group's patent related legal expenses in the second quarter of 2004 were consistent with the comparable 2003 period as we continued our DMT(R) patent commercialization and enforcement programs. Financial Condition Total consolidated assets were $99,721,000 as of June 30, 2004 compared to $90,040,000 as of December 31, 2003. Cash and cash equivalents and short-term investments on a consolidated basis totaled $60,394,000 as of June 30, 2004 compared to $50,500,000 as of December 31, 2003. In April 2004, Acacia Research Corporation raised net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of approximately $13,700,000 through the sale of three million shares of Acacia Research - CombiMatrix common stock in a registered direct offering. The net proceeds from this offering were attributed to the CombiMatrix group. CombiMatrix Group (A Division of Acacia Research Corporation) Financial Results Revenues for the second quarter of 2004 were $750,000 versus $6,000 in the comparable 2003 period. Second quarter 2004 revenues were comprised of $701,000 in government contract revenues and $49,000 in microarray product sales and other contract service revenues. The second quarter 2004 division net loss was $3,516,000 versus a division net loss of $5,197,000 in the comparable 2003 period. The second quarter 2004 divisional results include non-cash patent amortization, asset depreciation and stock compensation charges totaling $727,000 versus $1,393,000 in the comparable 2003 period. The second quarter 2004 divisional results also include a net legal settlement credit totaling $391,000 related to the fair value of AR-CombiMatrix common stock potentially issuable in connection with certain anti-dilution provisions of the September 2002 settlement agreement with Nanogen, Inc. Second quarter 2004 research and development expenses were $2,062,000 (including government contract costs) versus $2,158,000 in the comparable 2003 period. Second quarter 2004 research and development activities included increased government contract costs incurred in connection with the CombiMatrix group's commitments under its biowarfare detection contract with the Department of Defense and other internal research and development efforts in the areas of genomics, drug discovery and development and material sciences. Research and development expenses in the comparable 2003 period related primarily to the CombiMatrix group's research and development agreements with Roche, which were completed in the first quarter of 2004. Marketing, general and administrative expenses in the second quarter of 2004 increased to $2,228,000 from $2,099,000 in the comparable 2003 period, due primarily to an increase in marketing and sales costs related to the launch of the CombiMatrix group's CustomArray(TM) DNA microarray platform in March 2004 and an increase in corporate professional fees related to ongoing Sarbanes-Oxley compliance projects. Financial Condition Total assets for the CombiMatrix group were $61,418,000 as of June 30, 2004 compared to $50,161,000 as of December 31, 2003. Cash and cash equivalents and short-term investments totaled $28,921,000 as of June 30, 2004 compared to $17,299,000 as of December 31, 2003. In April 2004, Acacia Research Corporation raised net proceeds of approximately $13,700,000 through the sale of three million shares of Acacia Research - CombiMatrix common stock in a registered direct offering. The net proceeds from this offering were attributed to the CombiMatrix group. Acacia Technologies Group (A Division of Acacia Research Corporation) Financial Results DMT(R) license fee revenues for the second quarter of 2004 were $666,000 versus $19,000 in the comparable 2003 period. To date the Acacia Technologies group has entered into 160 license agreements for its DMT(R) technology. All of the Acacia Technologies group's material DMT(R) license agreements provide for license fee payments to be made by the respective licensees over the term of the licenses. The second quarter 2004 division net loss from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the was $1,049,000 versus $1,577,000 in the comparable 2003 period. Included in the second quarter 2004 divisional results are non-cash patent amortization and depreciation charges totaling $138,000 versus $156,000 in the comparable 2003 period. The divisional results for the comparable 2003 period also includes a non-cash charge totaling $207,000 related to the write-down of our investment in ADX Corporation. The second quarter 2004 results also include a $104,000 charge, net of minority interests, related to estimated additional costs to be incurred in connection with the discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. of Soundbreak.com, related primarily to certain noncancellable lease obligations and the inability to sublease sublease n. the lease of all or a portion of premises by a tenant who has leased the premises from the owner. A sublease may be prohibited by the original lease, or require written permission from the owner. the related office space at rates commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with existing obligations or negotiate more favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. terms. Marketing, general and administrative expenses in the second quarter of 2004 increased to $1,160,000 from $878,000 in the comparable 2003 period, due primarily to the addition of licensing and business development personnel, an increase in corporate professional fees related to ongoing Sarbanes-Oxley compliance projects and an increase in general and administrative overhead costs in connection with ongoing operations. Acacia Technologies group's patent related legal expenses in the second quarter of 2004 were consistent with the comparable 2003 period as we continued our DMT(R) patent commercialization and enforcement programs. Financial Condition Total assets for the Acacia Technologies group were $38,573,000 as of June 30, 2004 compared to $39,978,000 as of December 31, 2003. Cash and cash equivalents and short-term investments totaled $31,473,000 as of June 30, 2004 compared to $33,201,000 as of December 31, 2003. Business Highlights and Recent Developments Business highlights of the second quarter and recent developments include: CombiMatrix group: --In April 2004, Acacia Research Corporation raised net proceeds of approximately $13,700,000 through the sale of three million shares of Acacia Research - CombiMatrix common stock in a registered direct offering. The net proceeds from this offering were attributed to the CombiMatrix group. --In April 2004, the CombiMatrix group named Mark A. Kay KAY Kick Ass Year KAY Kansas Association of Youth , MD, Ph.D., to its Scientific Advisory Board. Dr. Kay is a Professor, Departments of Pediatrics pediatrics (pēdēă`trĭks), branch of medicine dedicated to the attainment of the best physical, emotional, and social health for infants, children, and young people generally. and Genetics genetics, scientific study of the mechanism of heredity. While Gregor Mendel first presented his findings on the statistical laws governing the transmission of certain traits from generation to generation in 1856, it was not until the discovery and detailed study of , and Director, Program in Human Gene Therapy, at the Stanford University School of Medicine Stanford University School of Medicine is affiliated with Stanford University and is located at Stanford University Medical Center in Stanford, California, adjacent to Palo Alto and Menlo Park. . Dr. Kay is one of the founders of and is currently the Vice President of the American Society of Gene Therapy American Society of Gene Therapy (ASGT) is a professional non-profit medical and scientific organization dedicated to:
--In June 2004, the CombiMatrix group announced that it will launch the CustomArray(TM) 12K DNA expression array in July 2004, offering researchers the ability to order a fully customizable array with more than 12,000 sites. CustomArray(TM) 12K expands CombiMatrix's microarray portfolio to meet the needs of a broader research audience. CustomArray(TM) products enable researchers to study any combination of genes from any genome genome: see genetics. genome all the genetic content contained within an organism. An organism's genome is made up of molecules of deoxyribonucleic acid (DNA) that form long strands that are tightly wound into chromosomes, which are found in the on a single chip. In addition to the complete customization and flexibility inherent in the CustomArray(TM) chips, CombiMatrix has simplified the ordering process with the first online custom microarray ordering website. --In June 2004, the CombiMatrix group entered into a co-marketing relationship with Axon Instruments, Inc., to jointly support sales of CombiMatrix's CustomArray(TM) microarray platform and Axon's GenePix scanners. --In July 2004, the CombiMatrix group introduced the first two in a series of catalog gene-expression microarrays. These two arrays focus on human drug metabolism Drug Metabolism/Interactions Definition Drug metabolism is the process by which the body breaks down and converts medication into active chemical substances. Precautions Drugs can interact with other drugs, foods, and beverages. and toxicology toxicology, study of poisons, or toxins, from the standpoint of detection, isolation, identification, and determination of their effects on the human body. Toxicology may be considered the branch of pharmacology devoted to the study of the poisonous effects of drugs. . --In July 2004, the CombiMatrix group entered into a co-marketing agreement with Strand Genomics to market Strand's data analysis tool for microarrays, with customized features that support CombiMatrix's CustomArray(TM) products. --In July 2004, the CombiMatrix group expanded its relationship with the irsiCaixa Foundation in Spain and selected two drug candidates for downstream pre-clinical development. The expanded agreement covers additional funding of research at irsiCaixa for the Human Immunodeficiency Virus human immunodeficiency virus n. HIV. Human immunodeficiency virus (HIV) A transmissible retrovirus that causes AIDS in humans. ("HIV") and the Hepatitis C Virus
abbr. hepatitis C virus HCV 1 Hepatitis C virus, see there 2. Human coronavirus. See Coronavirus. "). Acacia Technologies group: --To date the Acacia Technologies group has entered into 160 DMT(R) technology licensing agreements, including agreements with B&C Cablevision, Central Valley Cable TV, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , CinemaNow, Inc., Disney Enterprises, Inc., General Dynamics Interactive Corporation, Grupo Pegaso, LodgeNet Entertainment Corporation, NXTV, Inc., On Command Corporation, Oral Roberts Noun 1. Oral Roberts - United States evangelist (born 1918) Roberts University, T. Rowe Price T. Rowe Price (NASDAQ: TROW) is an independent global investment management firm and mutual fund manager based in Baltimore, Maryland. It was founded in 1937 by Thomas Rowe Price, Jr.. T. , 24/7 University, Inc., Virgin Radio and Wachovia Corporation. --In June 2004, for the mutual purpose of settling their then existing litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , Acacia Media Technologies Corporation entered into a license agreement for its DMT(R) technology with On Command Corporation. The license to On Command Corporation resolved a patent infringement patent infringement n. the manufacture and/or use of an invention or improvement for which someone else owns a patent issued by the government, without obtaining permission of the owner of the patent by contract, license or waiver. lawsuit filed by Acacia Media Technologies Corporation against On Command Corporation and its related companies, and counterclaims filed by On Command Corporation against Acacia Media Technologies Corporation. --In June 2004, Acacia Media Technologies Corporation filed a complaint in the District Court for the Northern District of California alleging infringement of Acacia Media Technologies Corporation's DMT(R) patents against 9 cable and satellite companies. Companies named as defendants in the lawsuit include Comcast Corporation, Charter Communications Charter Communications NASDAQ: CHTR is an American company providing cable television, high-speed Internet, and telephone services to more than 5.7 million customers in 29 states. It is the third-largest publicly traded cable operator in the U.S. , Inc., The DirectTV Group, Inc., Echostar Communications Corporation EchoStar Communications Corporation (NASDAQ: DISH) is the parent company of DISH Network and the maintainer of the satellite fleet that provides the signal that DISH Network markets. , Boulder Boulder, city, United States Boulder, city (1990 pop. 83,312), seat of Boulder co., N central Colo.; inc. 1871. A Rocky Mountain resort and a suburb of Denver, it is the seat of the Univ. of Colorado (1876). Ridge Cable TV, Central Valley Cable TV, LLC, Seren Innovations, Inc., Cox Communications Cox Communications is a privately owned subsidiary of Cox Enterprises providing digital cable television and telecommunications services in the United States. It is the third-largest[2] cable television provider in the United States, serving more than 6. , Inc., and Hospitality Network, Inc. (a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of Cox that supplies hotel on-demand TV services). In July 2004, Acacia Media Technologies executed a license and settlement agreement with Central Valley Cable TV. --On July 12, 2004, the United States District Court United States District Court In the U.S., any of the 94 trial courts of general jurisdiction in the federal judicial system. Each state, as well as the District of Columbia and the Commonwealth of Puerto Rico, has at least one federal district court. for the Central District of California issued a Markman Order giving the Court's construction of some of the disputed patent terms and phrases, and inviting further briefing or motions with respect to other patent terms that are in dispute in Acacia Media Technologies' ongoing litigation involving the Acacia Technologies group's DMT(R) patents against adult entertainment companies. The Court set a telephonic case management conference for August 17, 2004 at which time the Court will set a schedule for additional motions and briefing on Markman related issues. Acacia Research Corporation issued a statement regarding the Markman Order in a press release on July 13, 2004. --In July 2004, the Acacia Technologies group acquired U.S. Patent No. 6,226,677 from LodgeNet Entertainment Corporation. The newly acquired patent has several potential licensing opportunities, including DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary registrations, wireless "hotspots", and hotel high-speed Internet See broadband. access ("HSIA Hsia (shēä), semilegendary first dynasty of China, which ruled, according to traditional dates, from c.2205 B.C. to c.1766 B.C. or, according to some modern scholars, from c.1994 B.C. to c.1523 B.C. "). The patent covers technology and methods for redirecting users to a login Signing in and gaining access to a network server, Web server or other computer system. The process (the noun) is a "login" or "logon," while the act of doing it (the verb) is to "log in" or to "log on. page when accessing the Internet. A conference call is scheduled for today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern). Paul R. Ryan, Chairman and CEO of Acacia Research, Robert "Chip" Harris, President, and Amit Kumar, Ph.D., CEO and President of CombiMatrix Corporation will host the call. The CombiMatrix Group presentation and Q&A will precede the Acacia Technologies Group presentation and Q&A session. To listen to the presentation by phone, dial (888) 857-6932 for domestic callers and (719) 457-2604 for international callers, both of whom will need to provide the operator with the confirmation code 690397. A replay of the audio presentation will be available for 30 days at (888) 203-1112 for domestic callers and (719) 457-0820 for international callers, both of whom will need to enter the code 690397 when prompted. The call is being webcast by CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network and can be accessed at Acacia Research Corporation's website at www.acaciaresearch.com. ABOUT ACACIA RESEARCH CORPORATION Acacia Research Corporation comprises two operating groups, Acacia Technologies group and CombiMatrix group. The Acacia Technologies Group develops, acquires, and licenses patented technologies. Acacia's DMT(R) technology, which is supported by 5 U.S. and 31 foreign patents, relates to audio and audio/video transmission and receiving systems commonly known as audio-on-demand, video-on-demand, and audio/video streaming, and is used for distributing digital content via several means including Internet, cable, satellite and wireless systems. The CombiMatrix group is developing a platform technology to rapidly produce customizable active biochips, which are semiconductor-based tools for use in identifying and determining the roles of genes, gene mutations Noun 1. gene mutation - (genetics) a mutation due to an intramolecular reorganization of a gene point mutation genetic science, genetics - the branch of biology that studies heredity and variation in organisms and proteins. CombiMatrix's technology has a wide range of applications including DNA synthesis/diagnostics, drug discovery, and immunochemical im·mu·no·chem·is·try n. The chemistry of immunologic phenomena, as of antigen-antibody reactions. im detection. CombiMatrix's Express Track(sm) drug discovery program is a systems biology Systems biology, a field of study in the biosciences, focuses on the systematic study of complex interactions in biological systems. Particularly from 2000 onwards, the term is used widely in the biosciences, and in a variety of contexts. approach, using its technology, to target common viral diseases viral diseases Diseases caused by viruses. Long-term immunity usually follows viral childhood diseases (see chickenpox). The common cold recurs into adulthood because many different viruses cause its symptoms, and immunity against one does not protect against others. with siRNA compounds. Acacia Research-Acacia Technologies (Nasdaq:ACTG) and Acacia Research-CombiMatrix (Nasdaq:CBMX) are both classes of common stock issued by Acacia Research Corporation and are intended to reflect the performance of the respective operating groups and are not issued by the operating groups. Information about the Acacia Technologies group and the CombiMatrix group is available at www.acaciaresearch.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995: This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" . Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including the recent economic slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. affecting technology companies, our ability to successfully develop products, rapid technological change in our markets, changes in demand for our future products, legislative, regulatory and competitive developments and general economic conditions. Our Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , recent and forthcoming Quarterly Reports on Form 10-Q Form 10-Q See 10-Q. , recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.
ACACIA RESEARCH CORPORATION
SUMMARY FINANCIAL INFORMATION
(In thousands, except share and per share information)
(Unaudited)
CONSOLIDATED BALANCE SHEET INFORMATION
June 30, December 31,
2004 2003
--------- ------------
Total Assets $ 99,721 $ 90,040
Total Liabilities $ 12,933 $ 28,513
Minority Interests $ 780 $ 1,127
Total Stockholders' Equity $ 86,008 $ 60,400
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months For the Six Months
Ended Ended
----------------------- -----------------------
June 30, June 30, June 30, June 30,
2004 2003 2004 2003
----------- ----------- ----------- -----------
Revenues:
Research and
development
contract $- $- $17,302 $-
License fees 666 19 1,265 25
Government contract 701 - 918 -
Service contracts 5 6 86 13
Products 44 - 60 209
----------- ----------- ----------- -----------
Total revenues 1,416 25 19,631 247
----------- ----------- ----------- -----------
Operating expenses:
Cost of product sales 36 - 40 77
Cost of government
contract revenues 653 - 858 -
Research and
development expenses 1,409 2,158 2,792 4,493
Non-cash stock
compensation
amortization - research
and development 32 280 101 282
Marketing, general
and administrative
expenses 3,964 3,552 7,850 7,807
Non-cash stock
compensation
amortization -
marketing, general
and administrative 143 496 477 634
Amortization of patents 399 399 798 799
Legal settlement
charges (credit) (391) - 866 -
----------- ----------- ----------- -----------
Total operating
expenses 6,245 6,885 13,782 14,092
----------- ----------- ----------- -----------
Operating income
(loss) (4,829) (6,860) 5,849 (13,845)
----------- ----------- ----------- -----------
Other income
(expenses) 192 (4) 350 248
----------- ----------- ----------- -----------
Income (loss) from
operations before
income taxes and
minority interests (4,637) (6,864) 6,199 (13,597)
Benefit for income
taxes 69 66 136 126
----------- ----------- ----------- -----------
Income (loss) from
continuing operations
before minority
interests (4,568) (6,798) 6,335 (13,471)
Minority interests 3 24 3 30
----------- ----------- ----------- -----------
Income (loss) from
continuing operations (4,565) (6,774) 6,338 (13,441)
Discontinued operations:
Estimated loss on
disposal of
discontinued
operations (104) - (104) -
----------- ----------- ----------- -----------
Net income (loss) $(4,669) $(6,774) $6,234 $(13,441)
=========== =========== =========== ===========
Earnings (loss) per
common share:
Attributable to the Acacia
Technologies group:
Net loss $(1,153) $(1,577) $(2,142) $(3,071)
Basic and diluted loss
per share (0.06) (0.08) (0.11) (0.16)
Attributable to the
CombiMatrix group:
Basic
Net income (loss) $(3,516) $(5,197) $8,376 $(10,370)
Basic earnings (loss)
per share (0.12) (0.21) 0.29 (0.44)
Diluted
Net income (loss) $(3,516) $(5,197) $8,376 $(10,370)
Diluted earnings
(loss) per share (0.12) (0.21) 0.28 (0.44)
Weighted average
shares:
Acacia Research -
Acacia Technologies
stock:
Basic and diluted 19,787,466 19,640,808 19,769,901 19,640,808
=========== =========== =========== ===========
Acacia Research -
CombiMatrix stock:
Basic 30,459,576 24,183,340 28,867,101 23,586,624
=========== =========== =========== ===========
Diluted 30,459,576 24,183,340 30,385,512 23,586,624
=========== =========== =========== ===========
COMBIMATRIX GROUP
(A Division of Acacia Research Corporation)
SUMMARY FINANCIAL INFORMATION
(In thousands)
(Unaudited)
GROUP BALANCE SHEET INFORMATION
June 30, December 31,
2004 2003
--------- ------------
Total Assets $ 61,418 $ 50,161
Total Liabilities $ 7,765 $ 24,424
Minority Interests $ - $ -
Total Stockholders' Equity $ 53,653 $ 25,737
GROUP STATEMENTS OF OPERATIONS
For the Three For the Six
Months Ended Months Ended
----------------- ------------------
June 30, June 30, June 30, June 30,
2004 2003 2004 2003
-------- -------- -------- ---------
Revenues:
Research and development contract $- $- $17,302 $-
Government contract 701 - 918 -
Service contracts 5 6 86 13
Products 44 - 60 209
-------- -------- -------- ---------
Total revenues 750 6 18,366 222
-------- -------- -------- ---------
Operating expenses:
Cost of product sales 36 - 40 77
Cost of government contract
revenues 653 - 858 -
Research and development expenses 1,409 2,158 2,792 4,493
Non-cash compensation
amortization - research and
development 32 280 101 282
Marketing, general and
administrative expenses 2,228 2,099 4,506 4,768
Non-cash compensation
amortization - marketing,
general and administrative 143 496 477 634
Amortization of patents 274 274 548 548
Legal settlement charges (credit) (391) - 866 -
-------- -------- -------- ---------
Total operating expenses 4,384 5,307 10,188 10,802
-------- -------- -------- ---------
Operating income (loss) (3,634) (5,301) 8,178 (10,580)
-------- -------- -------- ---------
Other income 84 45 130 112
-------- -------- -------- ---------
Income (loss) from operations
before income taxes
and minority interests (3,550) (5,256) 8,308 (10,468)
Benefit for income taxes 34 35 68 68
-------- -------- -------- ---------
Income (loss) from operations
before minority interests (3,516) (5,221) 8,376 (10,400)
Minority interests - 24 - 30
-------- -------- -------- ---------
Division net income (loss) $(3,516) $(5,197) $8,376 $(10,370)
======== ======== ======== =========
ACACIA TECHNOLOGIES GROUP
(A Division of Acacia Research Corporation)
SUMMARY FINANCIAL INFORMATION
(In thousands)
(Unaudited)
GROUP BALANCE SHEET INFORMATION
June 30, December 31,
2004 2003
--------- ------------
Total Assets $ 38,573 $ 39,978
Total Liabilities $ 5,438 $ 4,188
Minority Interests $ 780 $ 1,127
Total Stockholders' Equity $ 32,355 $ 34,663
GROUP STATEMENTS OF OPERATIONS
For the Three For the Six
Months Ended Months Ended
----------------- -----------------
June 30, June 30, June 30, June 30,
2004 2003 2004 2003
-------- -------- -------- --------
Revenues:
License fees $666 $19 $1,265 $25
-------- -------- -------- --------
Total revenues 666 19 1,265 25
-------- -------- -------- --------
Operating expenses:
Marketing, general and
administrative expenses 1,160 878 2,166 2,202
Legal expenses - patents 576 575 1,178 837
Amortization of patents 125 125 250 251
-------- -------- -------- --------
Total operating expenses 1,861 1,578 3,594 3,290
-------- -------- -------- --------
Operating income (loss) (1,195) (1,559) (2,329) (3,265)
-------- -------- -------- --------
Other income (expenses) 108 (49) 220 136
-------- -------- -------- --------
Income (loss) from operations
before income taxes and minority
interests (1,087) (1,608) (2,109) (3,129)
Benefit for income taxes 35 31 68 58
-------- -------- -------- --------
Loss from continuing operations
before minority interests (1,052) (1,577) (2,041) (3,071)
Minority interests 3 - 3 -
-------- -------- -------- --------
Loss from continuing operations (1,049) (1,577) (2,038) (3,071)
Discontinued operations:
Estimated loss on disposal of
discontinued operations (104) - (104) -
-------- -------- -------- --------
Division net loss $(1,153) $(1,577) $(2,142) $(3,071)
======== ======== ======== ========
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